According to a recent study, it appears the same rules aren’t equal depending on your gender, female to be exact. It turns out that 15 to 20 percent of women entrepreneurs are less likely to be approved for a business loan through a bank. Fortunately, though, from women having successfully climbed the corporate ladder for so many years now, they now garner respect on the job. As it relates to traditional lending then, this is just another arena that needs a bit more time to evolve. While that’s taking place, here are two alternative financing tools you can utilize so that you can get funding when you need it, just like the men.
You may want to consider applying for a working capital loan. Basically, this is a short-term loan that is usually used for day-to-day, financing needs. With this kind of loan, interest rates are known to fluctuate depending on the term. Partly due to convenience, the percentage rate per year for a working capital loan is often higher compared to others. This financing tool can come in especially handy during seasonal fluctuations of a business.
You may also want to look into getting a merchant cash advance. The way this type of alternative financing works is that you are essentially borrowing money from the business that is due to come in from your receivables. The businesses that tend to benefit the most from a merchant cash advance are those that are quickly growing or that use it to increase revenue.
Compared to a bank loan, advances are usually smaller and can range anywhere from $5000 to $150,000. Some businesses draw on advances quite frequently. Like any type of borrowing, though, you still need to be prudent about using it wisely and need to make every effort to pay it back.
It’s estimated that small businesses actually being approved for a traditional bank loan are only about 50-50. If you’re a woman entrepreneur, your odds are even less than that. Along with not having to go through months of red tape to be approved, this is one of the biggest reasons that men and women are turning to alternative financing in droves.
As more and more women go into business for themselves and succeed, biases against females can’t help but start to dissipate in society. If you’re a woman entrepreneur, consider using the services of an online lender for alternative financing. It’s one of the quickest and easiest ways to get a business loan. Not to mention, you’ll be treated as an equal player.